4
| Crime |

"Operation Cowtown Tobacco," Which Took Down a Local Cigarette Trafficking Ring, Has Come to a Close

^
Keep Dallas Observer Free
I Support
  • Local
  • Community
  • Journalism
  • logo

Support the independent voice of Dallas and help keep the future of Dallas Observer free.

The margins in the illicit cigarette trade are relatively low. Tobacco is legal, for one, eliminating the risk-based premium that comes with trading in illegal drugs, and there's a lot of competition, which puts downward pressure on retail prices.

But there is a margin, enough of one to attract entrepreneurial types like Glen Murray McDonald, who don't mind -- and this is the part that makes it illicit -- skirting state and/or federal tobacco taxes.

McDonald, a 50-year-old from Pasadena, Texas, was sentenced this morning to nine months in federal prison, followed by nine months home confinement after pleading guilty to his role in what prosecutors dubbed "Operation Cowtown Tobacco." Ten others nabbed in the operations, all Texans, most from the Dallas-Fort Worth area, had previously been sentenced and ordered to pay restitution ranging from $24,000 to $1.1 million.

McDonald's scheme centered on counterfeit cigarette tax stamps, which cost $1.41 each in Texas and must be on every pack of cigarettes received by a distributor within 96 hours. (Federal taxes are levied earlier in the supply chain.)

He had 133,320 counterfeit tax stamps when he was busted in Euless in April 2012, trying to make a half-million-dollar purchase of 13,320 cartons of cigarettes (and 50 kilos of synthetic marijuana) from an uncercover ATF agent. If those had been affixed to packs of cigarettes and sold, it would've cost the state of Texas $187,000.

Send your story tips to the author, Eric Nicholson.

Keep the Dallas Observer Free... Since we started the Dallas Observer, it has been defined as the free, independent voice of Dallas, and we would like to keep it that way. Offering our readers free access to incisive coverage of local news, food and culture. Producing stories on everything from political scandals to the hottest new bands, with gutsy reporting, stylish writing, and staffers who've won everything from the Society of Professional Journalists' Sigma Delta Chi feature-writing award to the Casey Medal for Meritorious Journalism. But with local journalism's existence under siege and advertising revenue setbacks having a larger impact, it is important now more than ever for us to rally support behind funding our local journalism. You can help by participating in our "I Support" membership program, allowing us to keep covering Dallas with no paywalls.

We use cookies to collect and analyze information on site performance and usage, and to enhance and customize content and advertisements. By clicking 'X' or continuing to use the site, you agree to allow cookies to be placed. To find out more, visit our cookies policy and our privacy policy.

 

Join the Observer community and help support independent local journalism in Dallas.

 

Join the Observer community and help support independent local journalism in Dallas.